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Tort reform proves government can work

As I See It

How did tort reform get passed in the Legislature? It’s a good study of how representative democracy really works, particularly at the state and local level.

Most everyone knows that House Speaker Billy McCoy and Judiciary Committee chairman Ed Blackmon were energetically opposed to passing meaningful tort reform that included any caps on pain and suffering. Many Mississippians, including myself, believed that tort reform without the caps was no tort reform at all.

So, the question became would the will of the voters prevail or would the trial lawyers, including Chairman Blackmon, retain their pot of gold to the detriment of the state’s economy?

Early in the regular session it became apparent that the majority of House members wanted to pass tort reform. So, to keep that from happening, the House leadership had to prevent the vote from ever reaching the floor. Efforts to prevent the membership from having a chance to vote on the issue did not simply stop with bottling the matter up in committee. No, as an additional nail in what they hoped would be the coffin of tort reform, Speaker McCoy had the rules changed to make it harder for the members to override the committee chairman. The only thing that prevented the success of this attempt to thwart the will of the people was the energetic response from the voters around the state. I’m told that the pressure on members of the Legislature became unbearable. The people not only spoke, they roared. Even Chairman Blackmon’s ludicrous attempt to paint the tort reform efforts with a racial brush failed to stem the tide.

Government is most responsive at the local level. As the constituency gets bigger, each individual’s clout gets smaller. Voters have more impact with their county supervisors than with their congressman. Thus, when tort reform took center stage and voters began contacting their legislators, their voice was heard.

Tort reform was important for more reasons than are apparent on the surface.

All the rhetoric put forth by the trial lawyer lobby saying those massive, ridiculous jury awards for pain and suffering had no impact on the attractiveness of our state for business was absurd and everyone knows it. It was driving the cost of doing business in Mississippi too high to be acceptable.

Additionally, all these jury awards come back to haunt us in the form of higher prices since business has nowhere to get funds but from their customers and that’s us.

The tort reform bill covered more than just pain and suffering caps. Punitive damages are capped on a sliding scale based on the net worth of the defendant. Another important provision in the bill limits venue shopping whereby out-of-state plaintiffs flocked to certain Mississippi counties known to make outrageous damage awards. Finally, the law reforms joint-and-several liability whereby defendants are only responsible for their share of the damages awarded.

What will the impact of tort reform be on the business community in Mississippi?

Strategic business decisions are made slowly and carefully. There will be no knee-jerk flood of new plant openings as a result of curtailing civil justice abuse. However, we will gain new jobs over the coming years as a result of the Legislature’s action.

Businesses look to a number of factors when choosing a new location. Climate, transportation, labor cost and availability, friendliness of government and the overall cost of doing business. Our cost of doing business just went down and we will reap the benefits of that change over time.

And, what’s the cost to people of being limited to a mere $1 million for all their pain and suffering? Well, I’d be willing to put up with a fair amount of pain and suffering for a million bucks! Some of the trial lawyers might have to downgrade their automobile fleet to Mercedes and sell a few of the Bentleys, but it’s unlikely they’re going to qualify for food stamps as a result of tort reform.

Though this past legislative session has been a tough start for Gov. Haley Barbour, nevertheless he was able to stay the course and provide the unwavering push that put caps on Mississippi’s judicial nightmare. The majority of our legislators deserve credit for doing the right thing in the face of intense pressure from the House leadership to do otherwise. Business groups like the Mississippi Economic Council and Mississippians for Economic Progress kept the Legislature’s feet to the fire and their efforts paid off. At election time, we need to recall who was supportive and who was obstructionist in the fight to rid Mississippi of the demon of jackpot justice.

Thought for the Moment — In the house of the wise are stores of choice food and oil, but a foolish man devours all he has. — Proverbs 21:20

Joe D. Jones, CPA, is publisher of the Mississippi Business Journal. Contact him at cpajones@msbusiness.com.

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